DWS is stepping up its ambitions in private credit, focusing on asset-based finance—lending and investment strategies secured by collateral such as real estate, infrastructure or receivables. The Frankfurt-based assetmanager is building a specialised platform to capture what it sees as the next phase of growth in Europe’s alternative investment market.
On the firm’s third-quarter analyst call on Thursday, chief executive Stefan Hoops reported steady progress on the build-out of the business and said 2026 will mark the start of meaningful earnings contributions from private credit.
“Our private credit platform build-out is progressing steadily,” Hoops said. “During the third quarter, we finalised a number of key hires that strengthen our capabilities, ensuring we have the right expertise in place. In parallel, we have kicked off a series of roadshow activities to engage directly with investors and showcase our differentiated approach.”
The senior team is now complete and fundraising. Additional vice presidents and associates are being recruited to expand capacity. For now, Hoops said, the focus remains on developing expertise and investor relationships rather than chasing short-term inflows.
Focus on asset-based finance
DWS is sharpening its focus on asset-based finance, which Hoops described as a niche requiring distinct operational and analytical skills.
“Understanding who owns collateral and ensuring that it’s not pledged to other parties seems to be a skill set distinctly different from credit underwriting of corporates,” he said. “I don’t know if asset-based finance is for everyone, but it seems that more and more focus goes towards that.”
The shift reflects a broader trend in private credit, where managers are seeking differentiated sources of return as traditional corporate lending becomes increasingly competitive. By anchoring its approach in collateral-backed structures, DWS aims to offer investors stable, income-oriented exposure with greater transparency over underlying risks.
“Risk reward in direct lending seems to be somewhat exhausted, which is why everyone seems to be focused on asset-based finance,” Hoops said.
Positioning for the next phase
With its senior private credit team in place and its partnership with Partners Group formalised, DWS is positioning itself as a disciplined, Europe-focused player in specialist credit markets. The platform’s build-out will continue through 2025, paving the way for tangible results the following year.
“We are progressing nicely,” Hoops told analysts. “Based on the specific opportunities I see in private credit, I would expect this to start contributing pretty meaningfully in 2026.”
Partners Group collaboration
A central element of DWS’s private markets strategy is its partnership with Partners Group, announced in September together with Deutsche Bank, DWS’s majority shareholder. The three firms plan to launch an evergreen private markets fund under the European Long-Term Investment Fund (Eltif) 2.0 framework, expanding private markets access to qualified private clients across the European Economic Area and Switzerland.
Partners Group, one of the most active alternative investment firms in Luxembourg, will manage the new fund, while DWS acts as Alternative Investment Fund Manager (AIFM) under Luxembourg law. The Eltif 2.0 format is designed to make private market strategies more accessible to individuals by allowing regular entry and exit after an initial holding period.
“This is essentially teamwork between Deutsche’s private bank, Partners Group and us,” Hoops explained. “We are setting up and managing the Eltif, while Partners Group provides the private markets capabilities. Partners Group is a formidable, long-standing alternative asset manager with great knowledge in private equity and private credit. We simply do not have private equity or venture capital capabilities, so if you choose somebody managing a fund-of-funds across several strategies, Partners Group simply has broader capabilities than DWS.”
Hoops called the partnership “amicable and well coordinated”, combining DWS’s distribution strength with Partners Group’s expertise in private markets.
“With our knowledge in retail distribution and alternatives, having these complementary structures for retail distribution in Europe is going to provide upside for DWS,” he said. “Over time, we want to develop those capabilities ourselves, and I think having that additional structure will come in quite handy for us.”